It was interesting over the past several days to watch traders sell off Apple Inc. (AAPL) ahead of their big announcement today on their new iPhone. Normally Apple rallies hard into their announcements on new products. But this time traders came in early and sold it off ahead of the news. It tried several times today to lose its 20-day exponential moving average at 659.00, but every time it went below, the buyers came in and gobbled up shares. There were at least four attempts to get it below with many tests at 657, or a drop below. Within minutes it was always right back above. It closed strongly, which surprised the masses, but the selling ahead of the news allowed the weaker hands to leave opening the door for buyers very late in the session. Never a guarantee of strong days ahead, but it was a positive close on the stock for sure. Apple is very heavily weighted so a good Apple chart is bullish for the Nasdaq 100 and the market in general.

However, with Apple behind us the market, traders are focusing on tomorrow, when just after noon eastern-time, we get the word from Mr. Bernanke on what’s on his agenda in terms of providing liquidity and stimulus to the economy. The majority of people now think QE3 is in the cards for tomorrow. I don’t agree, but it doesn’t matter what I think. If he gives QE3, the market should move higher, but if he doesn’t, we should get some minor-to-moderate selling initially that will eventually be bought back up over time. He’ll most definitely say something about stimulating, but more in line with bond buying and not an outright QE3 program. He won’t want to disappoint Wall Street. Interesting day as Apple came through as usual. Now let’s see what the Fed does for the markets tomorrow.

The only thing that could really kill this market short-term is from the Fed himself. There are other events out there around the world that could do the same damage, but they seem contained for now. Global financial collapse isn’t in the cards at least for the very short-term. The European Central bank in conjunction with our Fed would simply never let that happen in the very short-term. They may not be able to do anything about it longer-term, but short-term there’s no way. This leaves the Fed to say absolutely nothing about stimulus tomorrow.

Since that is almost entirely impossible, I think we don’t have to worry about anything more than your ordinary type of pullback should he disappoint somewhat tomorrow on his statement about future actions. A few percent could happen at any time, but again, only if the Fed really lets everyone down tomorrow, and that has almost no chance of happening. Anything is always possible, but I don’t think that has any chance of taking place tomorrow. Once he finishes his statement, people will be tuned in even more to listen to his question and answer session. It’ll be very interesting to see what he says tomorrow about the state of our nation. I think most won’t like the actual state of things, but once again, it’s all about financial protection, which he will provide whenever it’s deemed an emergency to do so.

The market is in a fight technically. It has powerful resistance just a few points above at 1440 on the S&P 500. If this level were to be taken out by the bulls with some force and volume, always best if there’s volume, then it’s likely we head decently higher, at least by a few percent points. We have tried several times, including today, to get through, but thus far, no luck for the bulls. That said, the market is not exactly falling very hard away from S&P 500 1440. That’s a positive sign as the bears can only stave off the breakout. But they are having little to no success bringing the market down with any appreciable force. A loss of the 20-day exponential moving average would be a start for them. That means getting the market to lose S&P 500 1413. It won’t be easy for the bears to eradicate that level.

Some small exposure is fine, but only when we see what the market can do with S&P 500 1440, once the Fed speaks tomorrow, and only then can we decide if more exposure is appropriate.